Not to be forgotten, some smaller regional banks also report their quarterly results this week. As the name suggests, regional banks tend to limit operations to smaller regions of the country, and thus are not as exposed as some of their larger cousins to the troubles in Europe or investment banking.

Company

Average Est. EPS

Actual EPS

Difference

Cullen/Frost Bankers(NYSE: CFR)

$0.87

$0.90

3.4%

Central Pacific Financial(NYSE: CPF)

$0.32

$0.29

(9.4%)

First Commonwealth Financial(NYSE: FCF)

$0.09

($0.05)

(155.6%)

First Midwest Bancorp(Nasdaq: FMBI)

$0.10

$0.05

(50%)

Source: Yahoo! Finance and company press releases.

Some earnings highlightsIt was a record year for Cullen/Frost, in terms of both earnings and total assets. With most regional banks, success is determined by the economic conditions of the region in which they operate. According to Dick Evans, chairman and CEO, "The Texas economy continues to outpace the U.S., with growth and oil energized by the Eagle Ford Shale." Nonperforming assets were also down 26.7% for the year, which is always good to see.

After three consecutive years of losses, Central Pacific rode a fourth consecutive profitable quarter to its first profitable year since 2007. Despite this, Central Pacific was one of the worst-performing regional banks in 2011. Things are looking up for the Hawaii bank, however, with a $27.7 million reduction during the fourth quarter in nonperforming assets.

First Commonwealth experienced a loss, primarily because of collateral valuation change of some "Other Real Estate Owned," which is bank-speak for foreclosed properties that the bank holds on its balance sheet. T. Michael Price, president and CEO, felt that this action needed to be done to increase future performance. He went on to say, "The decrease we experienced this quarter in nonperforming loans, combined with ongoing declines in our criticized assets, sends a clear message that First Commonwealth is determined to move forward and is focused on creating superior value for our investors."

First Midwest saw a loss for the quarter, primarily because of some restructuring costs due to some "organizational realignment." However, 2011 could be deemed a success overall for the bank, with a return to profitability as well as a complete repayment of TARP funds. President and CEO Michael L. Scudder sees some opportunity in 2012, stating, "With TARP behind us and economic recovery progressing, we are very well positioned to pursue opportunities for growth, navigate the regulatory landscape, and, most importantly, help our clients achieve success in 2012."

Opportunities in regional banksI like the potential of regional banks personally, but they may not be for everyone. Earnings are just one thing to consider when choosing an investment, so view these results as a small piece of a much larger puzzle. In fact, a bank similar to the ones here is featured prominently in our brand-new free report "The Stocks Only the Smartest Investors are Buying." To find out which one it is, get your copy today before it's too late.